Most people care about the natural environment. They care either because it affects their health or because they just like it. There are two ways to build environmental caring into economic analysis. One way is to assign monetary values to environmental attributes and include them in monetary analyses. The other way is to examine tradeoffs between environmental attributes and money-based ones, such as profitability. This page covers the environmental valuation approach.
- Ecosystem Valuation: Many methods are available for estimating environmental values. This page from the Environmental Literacy Council gives a sound introductory overview.
Environmental Values from Previous Studies:
Because it can be costly to develop careful estimates of environmental values, it sometimes makes sense to adapt values from prior studies. Government agencies in Australia and Canada have assembled two major databases of prior studies that developed environmental values. Great care should be taken when transferring values from the time and place where they were developed to other settings. However, these databases provide useful frame of reference.
- Environmental Valuation Reference Inventory (EVRI): EVRI is a database for benefits transfer. This database was developed by Environment Canada in collaboration with a number of international experts and organizations among which the United States Environmental Protection Agency, Office of Water is especially noteworthy. The EVRI is an exclusively Web-based application, designed for use with Microsoft Internet Explorer or Netscape Navigator. Users may choose to work in English, French or Spanish. Subscription is required to access the database.
- Environmental Valuation & Cost-Benefit News maintains an inventory of news items that have reported environmental values. While these new stories may lack academic rigor, they report values that have been diffused publicly.